Pie Funds’ founder and Chief Investment Officer Mike Taylor op-ed on AI as seen here in Hawke's Bay Today.
At the start of the year, AI’s critics had plenty to worry about: runaway data centre spending, a software industry under threat, mass unemployment, even a repeat of the 1999 Dotcom bubble.
Nine months into 2026, none of that has happened. If anything, the boom is accelerating.
Google, Amazon, Microsoft and Meta are expected to spend around US$745 billion this year on data centres, chips and energy1 - and have already spent more than US$1.1 trillion in capital expenditure since 2023.2
Is anyone making money from it? Yes. OpenAI’s annualised revenue is reportedly above US$40 billion, roughly double last year’s.3 Anthropic, the company behind Claude, reportedly hit US$65 billion by July, up from just US$9 billion at the end of 20254 - the two account for revenue differently, but ChatGPT only launched in late 2022, and going from nothing to tens of billions in a few years doesn’t look like AI is fake to me.
Then there was the “SaaSpocalypse”. Investors decided AI agents were about to destroy the software industry - why pay Salesforce, Adobe or ServiceNow when Claude can build the software for you? At its height, around US$1 trillion was wiped from US software stocks in a week.5
I’ve always thought that worry was simplistic. Yes, I can ask Claude to build an application - but a large company still needs security, compliance and systems that work every day. I’m not convinced the CFO of a big bank is about to replace SAP with something Dave from accounts ‘vibe coded’ over the weekend. Software stocks have since recovered strongly; this looks more like a technology transition than an extinction event.
Jobs were the biggest fear of all. Yet the US economy added another 162,000 jobs in August, with unemployment steady at 4.1%.6 AI is replacing some roles - tech and finance employment is already falling - but inside companies, businesses want good people to become more productive, not to fire them. We’re training staff here at Pie Funds to use ChatGPT and Claude. The employee who understands your business and uses AI well becomes far more valuable.
Then there’s the backlash against data centres: America is discovering NIMBYism - people love ChatGPT, they just don’t want it next door. In Q1 2026 alone, local opposition blocked or delayed at least 75 US data centre projects worth around US$130 billion, over power, water and noise concerns.7 It’s now a political football ahead of the US mid-terms. You need land, electricity, transmission lines, turbines, nuclear plants, solar farms and batteries. Your AI agent can’t build a power station.
Finally, the bubble question. There are pockets of exuberance, and some capital will be wasted. But I struggle with the 1999 comparison: back then, tech companies had little revenue and no profits. Today, Microsoft, Alphabet, Amazon, Meta and Nvidia produce enormous revenues and profits - and despite the S&P 500 rising strongly this year, its forward price-earnings ratio is lower than at the start of the year, because earnings grew so quickly.8 That’s not how a bubble usually works.
So where does that leave us? AI spending is accelerating, revenues are exploding, the SaaSpocalypse hasn’t happened, and mass unemployment hasn’t arrived. The stock market, while not cheap, doesn’t look like 1999.
There are risks - including, this month, a revived debate about AI “escaping” human control and even causing our extinction. I think that’s nonsense, and not something an investor can price anyway.9 What I’m actually watching is more grounded: the scale of spending, electricity constraints, and whether all this capital eventually earns an acceptable return.
Nine months into 2026: so far, so good. And as an investor, that’s about as confident as you ever want to get.
Mike Taylor is the founder and Chief Investment Officer of Pie Funds Management Limited (Pie Funds). He’s been watching markets long enough to know that while history doesn’t repeat, it often rhymes - usually when you least expect it.
1 Financial Times, “
Big Tech AI spending spree tops $1tn”, August 2026.
2 Financial Times, “Big Tech AI spending spree tops $1tn”, August 2026.
3 Bloomberg News, “OpenAI’s Revenue Run Rate Tops $40 Billion Ahead of IPO”, 13 August 2026.
4 Bloomberg News, “Anthropic’s Annualized Revenue Tops $65 Billion Before IPO”, 18 August 2026.
5 Reuters, “US software stocks slammed on mounting fears over AI disruption, lose $1 trillion in week”, 5 February 2026.
6 US Bureau of Labor Statistics, “The Employment Situation — August 2026”, 4 September 2026.
7 Data Center Watch, “Q1 2026: Data Center Watch Report”, June 2026.
9 AP, “New warnings about the risks of AI to humanity revive a long-running debate”, 14 September 2026.
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